GOP Agrees: Keep the Caps

WILLIAMSBURG, Va.--Belying the battle over transportation spending that almost torpedoed last year's balanced budget agreement, House Republicans left their three-day retreat here today in virtual agreement not to exceed the discretionary spending caps set in that deal--even to pay for popular highway construction projects.

House Budget Chairman John Kasich, R-Ohio, and Appropriations Chairman Bob Livingston, R-La., Tuesday urged members against breaking the caps, while Transportation and Infrastructure Chairman Bud Shuster, R-Pa., argued for additional highway money and taking the transportation trust funds off-budget--reprising last year's fight over the fiscal 1998 budget resolution.

Rep. Robert Ehrlich, R- Md., a member of the Budget Committee, said the members' general feeling is that "the caps are sacrosanct. It's important that we keep our commitment, that it's not just another Washington promise."

But Ehrlich added that increasing transportation spending and respecting the caps "are not mutually exclusive. Certainly, there is sentiment among members to throw more money at transportation--but not at the cost of breaking the budget. The task now is how to accomplish both."

Nonetheless, a leadership source acknowledged that, especially in an election year, budget hawks still face "a 90-day battle where we'll continually have to reinforce our message" not to breach the caps before a final budget resolution is enacted. Another source said the leadership still has not decided the timing of this year's budget resolution, pointing out that waiting until May--rather than moving in March or April--could give congressional budget writers more money to work with if revenues continue to pour into the federal treasury.

Nor have any decisions been made about the size or form of tax cuts Republicans want, a number of members said, although they are pledged to delivering some type of tax cut this year.

During the "open mike" session with the leadership team that closed the two-day retreat, Rep. Lindsey Graham, R-S.C., said he told the leaders "we need to be more aggressive on the tax issue," both on revamping the tax code and reforming the IRS. Graham also expressed his concern that "we haven't spent a lot of time answering President Clinton on the State of the Union," particularly on his Medicare expansion and education initiatives.

Members also devoted time to healthcare and HMO reform, an issue Rep. Mark Souder, R-Ind., acknowledged is "constituent driven" and "a growing concern at the grassroots level" that Republicans must address. Although Souder said he feels GOP support for the managed care reform bill by Rep. Charles Norwood, R-Ga., has peaked, Norwood said his critics "are dreaming"--and that the leadership "understands the problem" that many Americans have with HMOs, and "is going to work with us to perfect" the bill.